jahowle

Stocks vs. Bonds: An Update for the Current Market

although credit spreads look tempting we have yet to see any headline bankruptcies and I think that is coming and could widen spreads even further. Senior loans also look cheap but there has to be some blowups coming in that area as well. The muni/govi spread trade looks more appealing from a risk standpoint. You can play this using the PZA and TBT. Just keep in mind that TBT is a double short of the Treasury so you would only buy half as much.


On Nov 09 06:04 PM Roger Knights wrote:

> What do you think about an arbitrage-type play of shorting long-term
> treasuries and buying BBB corporates? The great divergence in their
> yields shouldn't persist. (Right?)